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Essential InformationTitle: The Great

Depression of 1990

Author: Dr. Ravi Batra

Book Type: Macro Economics

Price:$11.67Publisher: Simon

& Schuster New York

ISBN:0-671-64022-4

About the AuthorBorn: Multan Jun 27 1943Occupation: Professor, Author.Education: M.A. Dehli School of EconomicsPh.D. Southern Illinois UniversityCurrent Employer: Southern Methodist University Dallas TXSpiritual Influence: Prahbat Ranjan Sarkar (Founder of Ananda Marga)Professional Heritage: Progressive utilization school

Raveendra Nath "Ravi" Batra

1.Can it Happen again?2.The Law of Social Cycles3.The Long Run Cycle of Money and

Growth in the United States4.The Long Run Cycle of Inflation5.The Long Run Cycle of Regulation6.Concentration of Wealth and

Depressions7.The Great Depression of 1990-

19968.Strategy for Investment9.Can We Prevent Another

Depression?

Distribution of Book

Reason for Writing this Book1. To inform the

society about the up coming recession

2. To provide guidance and advice about how to deal with it

3. To help in investment decision making in the predicted recessionary period

Prabhat Ranjan Sarkar 21 May 1921 – 21 October 1990

Philosopher, Author, Social, Revolutionist, Poet, Composer & Linguist.Major Works:• Law of Social Cycles• Progressive Utilization Theory• Philosophy of Neohumanism• Ananda Marga Org (Path of Bliss)• PROUT Universal

Sarkar’s PROUT

Practical alternative to the theories of Marxism (communism) and Capitalism

PROUT is based on universal values recognizing and protecting the rights of all

Protection of the environment

Dynamic, incentive-based multi-tiered economy

Cooperatively-employee-owned enterprises

Encourages a balance in the effort of satisfying individual and collective needs.

No one should be left behind as society marches forward

Review Cont… Can it Happen again?

Yes based on the economic & socio-political analysis done by the author.Predictions made by author:1.The Shah of Iran will be overthrown

and clergy would take over 19792. In 1980’s Iran & Iraq will start long

war3.Europe would experience recession

in 1986-874.America would suffer a depression

in 1989-905.Capitalism would be overhauled in

19990’s

The Law of Social Cycles

Long run economic cycle

Long run growth comparison

LONG RUN CYCLE OF INFLATION

GDP Change of US 1923 – 46 (Annual) 1947 – 09 (Quarterly)

Economic Depressions• The Depression of the

1780’s • The Great Depression of

the 1840’s• The Great Depression of

the 1870’s• The Great Depression of

the 1930’s

Economy determined by the Revolution in 1770s

Dependency on British Markets didn’t work

Peace Treaty with English Signed in Paris in 1783

Depression was caused mainly due to huge Balance of Trade

Protectionist policies of France and Britain US goods couldn’t be sold openly abroad

Depression lasted six years

The Depression of the 1780’s

•Inflation of Land, cotton, wheat and slaves rose•Virtually the whole nation felt the effects of the panic. Connecticut, New Jersey, and Delaware reported the greatest stress in their mercantile districts•In some other regions business activity decreased more than 20%•Lasted about seven years

The Great Depression of the 1840’s

The Great Depression of 1930’sWorst Depression of all timesEconomic Activity sank down to 40%

The Great Depression of 1930’s

Conventional Wisdom & Wealth Concentration•Changes in the

aggregate demand and

supply of goods and

services

•Total consumption

•Investment &

•Government

Expenditure

•Inept fiscal policy, tax

revenues fell, business

activity reduced, rising

tax rates reduces further

consumption.

YEAR Share of Wealth by 1%

Richest1929 36.3

1933 28.3

1939 30.6

1945 23.3

1949 20.8

1953 27.5

1956 26.0

The Great Depression of 1990-96Assumptions:History has its own rhythmMoney, Growth and Regulations have a deterministic pathRecessions though complex have a patternCycles of Inflation, Money etc crest every third decade in a centuryDepressions occur at intervals of three or six decades

•Theory of Economic Cycles is still alive.•History repeats itself• There are a few common characteristics among recessions• Viewing society revolving around sarkar’s philosophies•Patterns could be broken through fundamental economic reforms

Critical Analysis Lester Thurow wrote

intro but to a monograph/novel not this book.

New York times 1987 Aug 30; p.7 says sarkar was convicted of six murders

Batra talks to sarkar (LATE) via a type of meditation tantra

Forecast a great disaster & include a formula for redemption, either ways you’ll win.

Mixed ideas of Taxing & Saving Wealth Concentration

Social Science citation index 1986. 21 Ciataions

Critical Analysis cont…•Small sample size•Data gathering issues•Focus on US only•Sarkar’s Social Cycle theory lacks in explaining Laborers Era & Transformation Process

• More than one method for forecasting violates consistency principle•Insufficient conclusions drawn from the premise•Written for Fame & Money; not for Help!

Analysis of Economic RecessionsName: Umair HaqueNationality: Pakistani, BritishOccupation: Author, Director, Bloggers, Analyst, Business SpeakerEducation: Bachelors in Psychology (London School of Economics)MBA (Oxford University)Ph.D (Oxford University)Publications: The New Capitalist Manifesto. Regular Columnist of HBR, Economics for Humans, Building a Disruptively Better BusinessEmployer: Havas Media Lab

Alternative perspective

Discussion and Q/A Session Thank you